The third Monday in February honors all U.S. presidents. For some, it’s a great reason to learn more about American history; for others, it’s a day to shop and take advantage of winter sales. But the month also offers an opportunity to follow S&P 500 Index seasonal patterns that could potentially benefit your overall portfolio strategy.
February tends to be a mixed bag for equity market seasonal patterns. In fact, for those who follow these statistics, looking back over the past 20 years, there is a 55% likelihood that stocks move higher during this month.
Our latest analysis identified a variety of sectors that showed a seasonal tendency to outperform the S&P 500 during February over the last 20 years—a month when the index has on average been flat (0.02%). As we review the data, it’s important to note that nonseasonal factors still influence performance and should not be ignored.
A variety of sectors have on average tended to exhibit the highest relative strength during the month of February. However, if you are interested in looking under the hood for a more targeted strategy, out of the top 13 industry groups, consumer discretionary, consumer staples, industrials, and healthcare represent seasonally strong breadth.
As we progress through the shortest month of the year, we should remember to take advantage of the seasonal statistics that we tend to see in February—as it could be a good time to consider implementing this type of analysis as part of your portfolio management plan.
Past performance is no guarantee of future results. All indexes are unmanaged and cannot be invested into directly.
The opinions voiced in this material are for general information only and are not intended to provide or be construed as providing specific investment advice or recommendations for any individual security.
The economic forecasts set forth in the presentation may not develop as predicted.
Investing in stock includes numerous specific risks including: the fluctuation of dividend, loss of principal and potential illiquidity of the investment in a falling market.
Stock investing involves risk including loss of principal.
The Standard & Poor’s 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
Because of their narrow focus, specialty sector investing, such as healthcare, financials, or energy, will be subject to greater volatility than investing more broadly across many sectors and companies.
This research material has been prepared by LPL Financial LLC.
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